Keep Destroying Your Debt All Summer Long


debtWith summer around the corner, you?re probably anxious to look ahead to the summer fun, but if you have accumulated debt that is causing you worry, do yourself a long-term favor this summer and put that spending money towards your debt problem. But of course, it can be hard to watch your hard-earned cash go directly to your creditors. To make your payoff process as easy as possible, follow these steps for staying on track with getting out of debt this summer.

Take a Hard Look at Your Finances?

In order to effectively put an end to your debt, you will first need to take a realistic look at your finances to recognize how your spending habits have contributed to your debt.

First, you will want to figure out which expenses are necessary. Be honest with yourself on this one. Have you been letting your grocery bill get too high spending too much money on junk food? This is the time to really recognize how you have been letting your spending habits get away from you. Make sure you also track all of your accounts to make sure they look as they should and take this time to make any adjustments you?ve been meaning to make. Have you been thinking about switching to a different car insurance policy that will save you more money, but just haven?t gotten around to it? Use your extra summer hours to make time for chores like this.

Once you have a better picture of the percentage of your paycheck goes towards necessary expenditures, you can figure out how much of the remainder can be put directly towards your debt. This will be the hardest part, as you will need to be honest with yourself about how much you can really give to your creditors each month. The more you can give, the easier it will be to pay back your debt in a timely manner.

Tackle the Big Problems First?

You may feel tempted to ignore your biggest debts in favor of dealing with the smaller ones first. While it might feel good to pay off a whole credit card at once, it?s much more important to deal with these bigger debts as the longer you leave them unpaid, the worse your debt will get.

Make a plan for how you will tackle these larger debts and don?t be afraid to seek out tax relief help if you feel overwhelmed by the size of any of your debts. Especially with large debts, it can feel really demoralizing to make payments as you may feel like you never see your debt getting smaller. If you can only set aside a small amount of money each month, you may want to put all of it towards your larger debts (so long as you are also meeting the minimum payments for your smaller debts).

With the help of a professional, you may be able to consolidate your debts into a single amount so that all of your payments will go towards paying off the total and its interest. Seek out a zero-interest balance transfer. You will need to pay off your transferred debt quickly to avoid fees, but you will be able to save a lot on interest if you do this wisely.

Dealing with the Rest

Next, it?s time to handle your smaller debts. Of course, it?s great if you can pay these off all at once if you are done paying off your larger debts. But at the very least, you need to be making your regular minimum payments. However, sources suggest that you should only stick with the minimum payment amount if you truly cannot afford to pay any more, as minimum payment amounts are a debt postponement strategy rather than a debt payment strategy. Consider downloading a task manager app on your smartphone to remind you of due dates.

Freeze all spending on your credit cards while you work to pay off these amounts. The last thing you want is to be accruing new credit card debt.

If you are having trouble finding the money to tackle these debts, it?s time to take stock of the things you can sell to make some extra money. Utilize websites like eBay to quickly and easily sell those items that you don?t need, or have a yard sale. You should also consider finding seasonal ways to make extra money. In the meantime, as new sources of cash come in, for example through a work bonus, put these earnings directly towards your debt payment.

Try to Reward Yourself?

When dealing with your taxes, it?s good to think of it the same way you might think of a diet: it will work better in the long-term if you leave yourself a little bit of leeway and room to reward yourself. As you start to make a significant dent in your debt, try to find small ways to reward yourself so that you don?t feel like you are constantly fixating on paying back your debt. Set aside a very small amount of money for your entertainment fund each month and take yourself out to dinner. Or, better yet, start your new debt-free life off right by switching your emphasis to fun rewards that are free.



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